Gov. Tom Wolf increases minimum wage for state employees

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Gov. Tom Wolf used the power of his office to ensure state employees are paid at least $10.15 an hour, signing an executive order he hopes will propel legislative action to increase pay for all Pennsylvania workers.

For now, the effects will be concentrated on 450 out of 79,000 state workers at a cost to the state of about $1.6 million. The minimum wage will apply to most state contracts entered after July 1.

“This is fair for workers,” Wolf said at a Monday news conference. “$10.15 is not really a family sustaining wage, but it is better than where we are right now.”

Wolf's budget address last year called for raising the state's minimum wage to $10.10 an hour. With those budget plans incomplete, he followed up in February with a goal of $10.15 hourly, which he said would aid 1.2 million workers and boost state revenue by an estimated $60 million annually.

Jenn Kocher, spokeswoman for Senate Majority Leader Jake Corman, R-Centre County, called Wolf's order “symbolic.” The governor has not brought up minimum wage hikes during budget negotiations on a regular basis, she said.

“It just goes to highlight he doesn't really have any ability or desire to work with the Legislature,” Kocher said.

The administration anticipates a $2.6 million increase in wages for state contractors, including $1.6 million exclusive to a contract for photos at license centers. The provision applies to employees at contractors who spend at least 20 percent of their time on work related to the contract.

The state Department of General Services estimates about 109 vendors could potentially be affected by the executive order, spanning services such as janitorial, landscaping, delivery and food preparation.

The order won't include contracts with the Department of Human Services, Wolf said, because “we didn't want to put additional burdens” on providers who are struggling as a result of the budget impasse that has put their state appropriations on hold.

About 607 state highway contracts were executed in 2015, said Jason Wagner, managing director with the Pennsylvania Highway Information Association. But he said the 140 member firms he represents, all of which do business with the state, pay above $10.15 per hour as they are subject to prevailing wage laws.

Eric Madden, executive vice president with the American Council of Engineering Companies of Pennsylvania, also said his members pay above $10.15 an hour.

Neal Lesher, legislative director with the Pennsylvania chapter of the National Federation of Independent Business, said requisite paperwork for state contractors could be burdensome and hinder smaller companies from competing. But an across-the-board increase could cost about 31,000 workers their jobs, Lesher said, citing statistics from a study done by the Independent Fiscal Office in November.

“When you raise the mandatory minimum wage for entry-level workers, you take away an awful lot of first-job experience,” he said. “It makes the workforce less experienced all the way down the line.”

Since 2009, Pennsylvania's minimum wage has been set at the federal minimum of $7.25 an hour. Even with a 40-hour work week, some Pennsylvanians fall below the poverty line, Wolf said.

“It's just too little; you can't live like that,” Wolf said, flanked by Democratic legislative allies who support a statewide policy. “It's not a good thing for families.”

Neighboring states pay higher minimum wages, including $9 in New York, $8.25 in Delaware and Maryland, $8.75 in West Virginia, $8.38 in New Jersey, and $8.10 in Ohio for employers with annual gross receipts passing $297,000.

Melissa Daniels is a Tribune-Review staff writer. Reach her at 412-380-8511 or mdaniels@tribweb.com.

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